Core Viewpoint - Soul, a leading AI-driven immersive social platform, is rebranding its narrative from "social metaverse" to "AI + immersive social" as it embarks on its IPO journey in Hong Kong after 32 months. The platform has a strong user base, with nearly 80% of its users being Gen Z, and an average daily usage time exceeding 50 minutes, indicating high user engagement and stickiness [2][11]. Financial Performance - Soul's revenue is projected to grow from 1.667 billion RMB in 2022 to 2.211 billion RMB in 2024, with a 17.8% year-on-year increase in the first eight months of 2025, reaching 1.683 billion RMB [5]. - The company achieved its first positive adjusted net profit in 2023, amounting to 361 million RMB, and is expected to maintain profitability in 2024 and 2025 [5][7]. - The sales and marketing expenses as a percentage of total revenue have significantly decreased from 124.8% in 2020 to 38.3% in the first eight months of 2025, while maintaining a gross margin above 80% [7]. User Engagement and Market Potential - As of August 31, 2025, Soul has approximately 390 million registered users, with 11 million daily active users, 78.7% of whom are Gen Z. These users exhibit high engagement, with an average of 75 point-to-point private messages sent daily [11][14]. - The emotional economy market in China is projected to grow from 7.1 billion RMB in 2024 to 90 billion RMB by 2030, with a compound annual growth rate of 52.8% [8]. Global Expansion Strategy - Soul aims to expand globally, targeting markets in North America, Japan, and Southeast Asia, leveraging the universal need for emotional connection across cultures [14][15]. - The IPO proceeds will be used to establish overseas operations and marketing teams, as well as to develop monetization structures for international markets [15]. Challenges and Risks - Soul faces significant compliance and ethical risks, particularly concerning content safety, data compliance, and the protection of minors, which have previously led to platform suspensions [16]. - The company has a substantial financial liability of 12.4 billion RMB related to redeemable shares, which poses a risk to its financial health and necessitates successful IPO financing [17][18].

Core Insights - Soul, a social platform targeting Gen Z, has submitted its IPO application to the Hong Kong Stock Exchange for the fourth time, with 2024 revenue projected to exceed 2.2 billion yuan and 78.7% of users being from the Z generation [4][19]. Company Background - Founded by Zhang Lu, Soul was created to address the lack of platforms for genuine emotional expression, distinguishing itself from existing photo-centric social apps [5][7]. - The platform's unique features include anonymous interactions and a focus on "soul communication," which quickly attracted users feeling constrained by traditional social media [7][9]. Financial Performance - Soul initially adopted a "burn money for growth" strategy, with marketing expenses reaching 289.1%, 124.9%, and 118% of total revenue from 2019 to 2021, leading to a revenue increase from 70.7 million yuan in 2019 to 1.28 billion yuan in 2021 [9][10]. - In 2023, Soul shifted its strategy to focus on existing user value, achieving an adjusted net profit of 361 million yuan, with projected profits of 337 million yuan in 2024 and 286 million yuan in the first eight months of 2025 [9][12]. Revenue Model - The primary revenue source for Soul is "emotional value services," which account for approximately 90% of total revenue, including virtual gifts and membership privileges [9][10]. - The average monthly spending per paying user increased from 75.3 yuan in 2022 to 104.4 yuan by August 2025 [12]. IPO Journey - Soul's IPO attempts began in 2021 with a plan to list on NASDAQ, but faced setbacks due to regulatory pressures and legal issues, leading to a shift towards the Hong Kong market [14][17]. - After multiple failed attempts, the company is now better positioned for its fourth IPO attempt, having achieved profitability and developed a clearer AI strategy [17][19]. Challenges Ahead - Soul's revenue structure is heavily reliant on a single business model, with 90.8% of revenue coming from emotional value services, making it vulnerable to fluctuations in user spending [19]. - User growth has plateaued, with monthly active users declining from a peak of 29.4 million in 2022 to 28 million by August 2025 [19]. - The platform faces governance challenges, including issues related to scams and content moderation, as well as potential debt risks from financial obligations totaling between 11 billion to 12.4 billion yuan [19][21].

Core Insights - Soul, a platform aimed at creating a "soul social" space, is preparing for its fourth IPO attempt after achieving profitability for two consecutive years, with a focus on "emotional value services" as its main revenue source [2][3][5] Financial Performance - In 2022, Soul reported an adjusted net loss of 0.22 billion RMB, but turned profitable in 2023 with an adjusted net profit of 0.361 billion RMB, and is projected to earn 0.337 billion RMB in 2024 [6][7] - Revenue from 2022 to 2024 showed a compound annual growth rate of over 15%, with figures of 1.667 billion RMB, 1.846 billion RMB, and 2.211 billion RMB respectively [8] - For the first eight months of 2025, Soul achieved a revenue of 1.683 billion RMB, confirming its self-sustaining capability [7][8] Revenue Composition - Soul's primary revenue comes from "emotional value services," which account for over 90% of total income, while advertising services contribute around 10% [10] - The "emotional value services" include virtual goods and privileges, with users paying for virtual currency "Soul coins" to purchase items like customized avatars and virtual gifts [11][12] - Virtual gifts and tools generated approximately 60% of total revenue from 2022 to the first eight months of 2025, with significant contributions from recommendation privileges and AI-related income [15] User Engagement - As of August 2025, Soul had 3.9 million registered users, with daily active users reaching 11 million, predominantly from Generation Z, averaging over 50 minutes of usage per day [4][26] - The percentage of paying users increased from 5.7% in 2022 to 6.5% in the first eight months of 2025, with the average revenue per paying user (ARPPU) rising to 104.4 RMB, the highest in the industry [16] Challenges and Risks - Soul faces challenges related to user quality and safety, with reports of scams and inappropriate content linked to its anonymous platform [17][19] - The company has implemented measures to enhance content moderation and user safety, including the development of anti-fraud models [18][22] AI Integration - Soul is leveraging AI technology, particularly through its self-developed model "Soul X," to enhance user interaction and content creation [22][23] - The AI features aim to improve user engagement by facilitating conversations and matching users based on interests [25][26] - The market for AI and immersive emotional economy is projected to grow significantly, with an estimated size of 7.1 billion RMB in 2024, expected to reach 100 billion RMB by 2030 [25]

Core Viewpoint - Soul is making its fourth attempt to go public through an IPO on the Hong Kong Stock Exchange, with CITIC Securities as its sole sponsor, after previous attempts in the US and Hong Kong failed [1][2]. Group 1: Company Background - Soul focuses on providing "emotional value" services, distinguishing itself from other social platforms by allowing users to express themselves through avatars rather than relying on real identities or appearances [2]. - The company has attracted significant investment from notable backers, including Tencent, which holds a 49.9% stake and 25.7% voting rights, while the founder, Zhang Lu, owns 32% with 65% voting rights [2]. Group 2: User Engagement and Metrics - As of August 31, 2025, Soul is projected to have 11 million daily active users, with 78.7% belonging to Generation Z, making it the leading AI + immersive social platform in China [2]. - The average monthly user interaction rate is 86%, with users sending approximately 75 peer-to-peer messages daily [2]. Group 3: Financial Performance - Soul's revenue from 2022 to 2025 is projected to grow from 1.667 billion RMB in 2022 to 2.211 billion RMB in 2024, while the company has incurred losses of 508 million RMB in 2022, 129 million RMB in 2023, and 149 million RMB in 2024 [3][4]. - The adjusted net profit (non-IFRS) is expected to improve from a loss of 22 million RMB in 2022 to a profit of 2.86 million RMB in 2025 [3]. Group 4: Strategic Focus and Future Plans - The latest IPO prospectus emphasizes AI, with the term appearing 266 times, indicating a strategic pivot towards AI capabilities and immersive social experiences [5]. - The funds raised from the IPO are intended for AI development, global expansion, user base growth, and content creation [5]. - Soul has shifted its branding to align with the AI narrative, moving away from its previous focus on the metaverse as interest in that area wanes [5]. Group 5: Market Outlook - The acceptance of Soul's "AI + immersive social" narrative in the Hong Kong market remains uncertain and will be determined over time [6].

Core Viewpoint - Soul, a social platform, is making its fourth attempt to go public in Hong Kong, having previously faced three unsuccessful attempts. The company has shown improved financial performance and a clear business model, attracting significant attention from the market [2][3][5]. Group 1: IPO Attempts - Soul has made four attempts to go public, with the first being in May 2021 for a NASDAQ listing, which was paused due to potential legal issues [2]. - The second attempt in June 2022 to list on the Hong Kong Stock Exchange resulted in the prospectus becoming invalid within six months [3]. - The third attempt in April 2023 also failed, but the company is now trying again with updated financial data and a new business model [3]. Group 2: Financial Performance - Soul's revenue projections for 2022 to 2024 are 1.667 billion, 1.846 billion, and 2.211 billion RMB, respectively, with a compound annual growth rate exceeding 15% [5]. - The company has transitioned from continuous losses to stable profitability, reporting an adjusted profit of 361 million RMB in 2023 [5]. - Gross margins are strong, with rates of 86.3%, 85.5%, and 83.7% from 2022 to 2024, maintaining above 80% [5]. Group 3: Revenue Model - Approximately 90.8% of Soul's revenue comes from AI-driven emotional value services, including virtual goods and membership privileges [6]. - The average monthly revenue per paying user is 104.4 RMB, with a paying user rate of 6.5% [6]. Group 4: Shareholder Structure - Tencent is the largest institutional shareholder, holding 49.9% of Soul, while the founder retains 63.3% of voting rights through an AB share structure [7]. - This structure allows the founding team to maintain control while attracting significant strategic investors [7]. Group 5: User Demographics and Engagement - Soul targets younger users, with 78.7% of daily active users belonging to Generation Z [8]. - The platform shows high user engagement, with an average monthly active user interaction rate of 86.0% and a three-month user retention rate of 80% [8]. Group 6: Future Plans and Challenges - Soul plans to issue 10% to 15% of new shares, aiming to raise between 253 million to 300 million USD, with a post-IPO market valuation projected between 2.5 billion to 3 billion USD [9]. - The company intends to allocate 40% of the funds for developing its AI model, 25% for overseas market acquisition, and 15% for expanding emotional consumption products [9]. - Despite its preparations, Soul faces challenges in a competitive social media landscape and must prove its ability to retain users and gain investor confidence [10].